Tax
Business expenses
By the Finances Indépendants editorial teamUpdated on 3 min readAlso known as: Professional expenses, Actual expenses, Frais professionnels
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Contents
What is a deductible business expense?
A business expense is a cost incurred to earn or retain business income, actually borne during the financial year and backed by a document. These three conditions are cumulative, and it is the last one that sinks most files in a tax audit.
The deduction is made from taxable income, which makes it all the more worthwhile the higher your marginal rate: it saves tax at the top rate, up to 53.75% including municipal surcharges, and also reduces the basis for NISSE (National Institute for the Social Security of the Self-employed, INASTI/RSVZ) contributions.
The flat-rate regime
The flat rate applies without any supporting documents, but it is capped, which limits its value as soon as the business has significant actual costs. Two scales exist side by side: a single rate of 30% for the profits of a trader or craftsperson, capped at €6,070; and a sliding scale for the income of a liberal profession, capped at €5,340.
The sliding scale for liberal professions is read by income band.
- 28.7% from €0 to €7,720
- 10% from €7,720 to €15,340
- 5% from €15,340 to €25,530
- 3% above €25,530
The actual-expenses regime
As soon as the expenses you actually incur and can document exceed the applicable flat-rate ceiling, the actual-expenses regime becomes the better option. The choice is made year by year. There is no ceiling, but every expense must be documented and linked to the business.
The choice is made each year, on the tax return, and does not bind the following years. A self-employed person who invests heavily one year can therefore switch to actual expenses for that year and go back to the flat rate afterwards.
What is commonly deducted
The list depends on the business, but some items come up in almost every self-employed person's file.
- NISSE social security contributions and the social insurance fund's management fees.
- PLCI/VAPZ (free supplementary pension for the self-employed) premium, 100% deductible, up to €4,086.34 under the ordinary formula.
- Professional equipment, software and subscriptions, depreciated above a certain amount.
- Business travel, training, documentation.
- The business share of premises, heating, electricity and telecommunications.
- Fees for the accountant, the broker and advisers.
Mixed use, the real issue in an audit
Many expenses serve both the business and private life: housing, car, phone, internet. Only the business share is deductible, and it is up to the self-employed person to establish the allocation key.
The key must be reasonable, consistent from one year to the next and documented. A rounded split with no method behind it is the first thing an audit challenges, and the adjustment then covers several years.
Keep supporting documents for seven years, the standard audit period. An expense that is real but undocumented is not deductible, which amounts to the same thing as an expense that never existed.
Not to be confused with
The terms close to Business expenses and what sets them apart.
- Business expenses and company costs
- A company deducts its costs from its profit taxable under corporate income tax. Business expenses in the sense of this entry are deducted from an individual's income under personal income tax.
- Business expenses and deductible VAT
- VAT deduction follows its own rules and its own business-use key. An expense can be deductible for income tax without being fully deductible for VAT, and vice versa.
- Business expenses and depreciation
- A durable asset is not deducted in one go: it is depreciated over its useful life. The expense is the same; its spread for tax purposes differs.
Further reading
Business expenses: frequently asked questions
As soon as the expenses you actually incur and can document exceed the applicable flat-rate ceiling, the actual-expenses regime becomes the better option. The choice is made year by year. Below the ceiling, the flat rate spares you any documentation: €6,070 for a trader, €5,340 for a liberal profession. The choice is made again each year on the tax return.
Seven years, which is the standard audit period. An expense that is real but whose document has gone missing is no longer deductible, with the adjustment and surcharges that follow.
Only the business share is deductible, using an allocation key that you set and must be able to justify. The key must be reasonable and stable over time: it is the most frequently audited point.
Business restaurant costs are partially deductible, and entertainment costs at yet another percentage. These specific rates depend on the category of expense: ask your accountant for the exact breakdown.
Official source
- FPS Finance. View (new tab)(Official source, accessed on 2026-09-19)